Michigan Governor Clears Path for Automakers to Restart Production

Michigan Gov. Gretchen Whitmer is expected to allow factories to resume production soon, according to a report from Reuters. She is scheduled to speak at 3 p.m. ET today, May 7.

That announcement would allow automakers and automotive suppliers in Michigan to restart their plants.

GM and FCA had recently announced that they were aiming to return to production on May 18, but the ban on nonessential business in Michigan could've kept them from doing so.

UPDATE 5/7/2020: Michigan Governor Gretchen Whitmer announced that manufacturing will be able to resume beginning on May 11, confirming the Reuters report. Additionally, the state provided guidelines for the reopening of factories, including what they would require from companies in order for them to resume work.

Ford issued a separate announcement saying it will resume North American production in a "phased approach" starting on May 18 at nine plants in the U.S. and Mexico. The two plants opening a week later on May 25 are Flat Rock (Michigan), which builds the Ford Mustang and Shelby Mustang GT350/350R and the Lincoln Continental, and Oakville (Ontario), which builds the Ford Edge and Lincoln Nautilus. Ford's parts distribution centers will reopen on May 11 to support dealership service operations, the automaker said.Michigan's governor, Gretchen Whitmer, is expected to announce today that factories in Michigan can resume operation soon, which would allow automakers to restart production at plants across the state, according to a report from Reuters citing people familiar with the situation. The announcement is expected today at 3 p.m. during the governor's update on the coronavirus pandemic.

Both General Motors and Fiat Chrysler (FCA) had previously announced that they were aiming to resume production on May 18, but the stay-at-home order in Michigan, if not lifted for factories, would keep them from doing so. Ford has not yet named a date to restart production. Currently, the governor's executive order banning nonessential businesses from operation in Michigan is in effect through May 15.

The United Auto Workers (UAW) has said that it approves of GM and FCA's return-to-work date. That news followed a back and forth between the UAW and the automakers regarding when it would be safe for the union members to return to work on the factory lines.

“As for the start date, the companies contractually make that decision and we all knew this day would come,” UAW President Rory Gamble said in a statement in response to the announcement of the May 18 restart date. “Our UAW focus and role is, and will continue to be, on health and safety protocols to protect our members.”

The Detroit Three had been preparing for the restart of production at their factories through testing safety protocols in the plants that have remained in operation to produce personal protection equipment and ventilators.

Late last week, Reuters also reported that Michigan automotive suppliers, through the Motor & Equipment Manufacturers Association and the Original Equipment Suppliers Association, had sent a letter to Governor Whitmer saying that delays in the restart of the industry would lead to long-term economic consequences. The suppliers also noted that they needed a week of lead time before the automakers restart production to restore the flow of parts. Additionally, the suppliers noted that the industry as a whole is highly dependent on Michigan suppliers, meaning that many plants elsewhere will find a return to production difficult until Michigan plants are back up.

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